The Discussion On Financial Risks Of Enterprise M&A And Its Prevention

M&A, the abbreviation of merger and acquisition, refers to a kind of investmentaction, through which one enterprise can control another one by means of obtainingpart or whole property right of the latter. As a kind of enterprise actions, it is chasedby nations of sorts in the world because it can bring the enterprise with kinds ofdomino effects such as economy scale, resource deploy, combination coordinating.M&A is one of the important formats of carrying out recombining assets inenterprises, also the important measure of enterprise's double-quick expanding. Witha social angle, it is the important approach of optimizing social resources deploy.But it was researched that in those cases, successful cases were just three our ten,and its reason most can be cast back with financial risk. Sum up the failures in thepast then we can find, the reasons are a good many, but the financial risk is the mostone. Because in economic essential, M&A is a long term investment action, thefinancial activities among it are complicated, financial risk is more inevitable.Sometimes, the sequent brought by financial risk is fatal.However, the researches on financial risk of M&A are not systematized atpresent in our country, which is disadvantageous for enterprises in our country tochange mechanism and to cope with WTO. In addition, M&A action in our country islater than west Countries, it is still in primary phase. There are many problems existedin enterprises' assets, we'd better attach importance to the cognitions and preventionsabout the risks, especially the financial risks caused by M&A.Just based on this point, the thesis is deployed. First of all, the thesis begins withthe basic theory of M&A, then analyzes the motivations of M&A and the good & badeffect brought by M&A, after that, it introduces the history, status quo and foregroundof M&A in our country. Afterwards, combined with the basic theory and typicalexamples of financial risk in M&A, it classifies the financial risk with different angles,and analyzes the reasons of the risks, expatiates the contents of the financial risks onemphases, including At last, the last part introduces the measures to prevent thefinancial risk in M&A following the basic prevention principles, including preventionmeasures on the risk of the aim enterprise's value evaluation, the financing risk andthe financial risk in the integration period, which in order to be helpful to the healthyand canonical development of the enterprise M&A in our country.